Orlando City SC confirm lawsuit against Sao Paulo over missed payments, closes negotiations for Ganso

UPDATE: Orlando City SC announced on Thursday that they’ve closed negotiations for Paulo Henrique Ganso due to a lack of response from São Paulo FC by the MLS club’s deadline. They will move forward with their lawsuit.

Orlando City’s full statement is below:

"Orlando City Soccer Club closes negotiations for Paulo Henrique Ganso due to lack of response from São Paulo FC by the specified deadline. The Club will pursue a collection lawsuit for the non-payment of all the commitments owed by São Paulo FC as part of the loan deal of the player Kaká. No further comments will be issued on this matter."

ORLANDO, Fla. – MLS newcomers Orlando City SC have confirmed they are taking top Brazilian club Sao Paulo to court in a bid to recover almost $5 million in lost payments and interest from their Kaká loan to the club last year.

However, Orlando have also offered a compromise deal involving Sao Paulo’s 25-year-old midfield star Paulo Henrique Ganso, with City keen to take the wantaway midfielder in return for cancelling the debt and an additional $900,000-plus in transfer fees.

As of midday ET on Wednesday, Sao Paulo had turned down the Ganso offer, insisting they value Ganso closer to $10 million in overall terms, but negotiations are believed to be ongoing.

Kaká was signed from AC Milan by the Lions in July 2014, but then they loaned him out for the rest of the year to his hometown team at a fee of around $2 million for the six months. Heavy fines and interest payments have accrued since then.

“The club can confirm the lawsuit,” an Orlando spokesman told MLSsoccer.com on Wednesday. “But we have no further comments at this stage.”

Brazilian TV station Globo has been reporting the details this week and an OCSC source confirmed that the reports “are largely accurate.”

The Lions have given Sao Paulo a Thursday deadline to agree any deal for Ganso, who has made eight appearances for the national team and is actively looking for a move outside Brazil.

With the international transfer window currently open, Orlando know they have limited time to bring in at least one more signing alongside new left back Corey Ashe, who was acquired in a trade from Houston last week.

An attacking midfielder who could also play wide right would most suit coach Adrian Heath’s needs at the moment and the club source confirmed the team has other targets in mind if the Ganso proposal falls through.

If Sao Paulo are prepared to accept a revised offer for their player, he would command a Designated Player’s salary, which would mean Orlando would need to pay down one of their other DPs, Bryan Rochez or Carlos Rivas, using Targeted Allocation Money funds.

Ganso signed a five-year contract with Sao Paulo in 2012 and his former teammate and current Orlando star Kaká believes he would be a great fit for the Florida outfit.

“I think he is an extremely talented player,” Kaká told Globo TV. “I’d love to see him coming here.”

Ganso has already said he would have no problem joining the MLS ranks, especially as he would almost triple his wages in Brazil, and the move would also strengthen Orlando’s Brazilian connection with majority owner Flavio Augusto da Silva, Chief Operating Officer Alex Leitão, Kaká and forward Pedro Ribeiro all hailing from that country.

Simon Veness covers Orlando City SC for MLSsoccer.com.